MIS 2000MIS 2000

Organizations and

Information Systems –

Impact on Organizational Design(slightly revised, see outline)(slightly revised, see outline)

Outline

Two typologies of Information Systems

Organization design (structure, processes, culture, politics—deleted due lack of time; also minor revision of slide 11)

Relationships b/w organization design and Information Systems

MIS 2000 Information Systems for Management

IS Types - Organizational Function Served

ORGANIZATIONProduction + Support

Supply

Back-End

Delivery

Front End

Back-end: Purchasing Systems – supply chain

Production Systems – Manufacturing, Services, involved in org. core

business operations

Support to Production: HR, Accounting & Finance, Planning, Inventory, R+D, Engineering/Product Development

Front-end: Marketing & Sales Systems, Customer Relationship Mgt. (CRM) (customer tracking, sales recording, billing, competition/environment scanning, market segmentation)

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IS Types – Data and User

MIS 2000 Information Systems for Management

* Also called Reporting sys. or Admin. sys. The MIS area of study refers to all system types, not just MIS type of systems.

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Systems have different data, processing capabilities & deliverables

AND different Users

“Packing” systems together (see Note).

Everyday operations control Supervisory Management

Mid-levelManagement

Mid-range performance control & planning

ExecutiveManagement Strategic planning & control

*

Knowledge Work Systems (professionals)

Communication Systems (everybody)

Group Support Systems (everybody)

Relationship Between Two Typologies

MIS 2000 Information Systems for Management

Organizational Function

Data & UserType

Human Resources

TPS MIS/RS DSS

Database of travel claims

Detailed reports on travel claims in past month, drawn from Travel Claims Database

Module with if-then rules that processes detailed reports and identifies deviations from organization’s rules.

….

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• Different IS types based on data/user can be in each department.

IS and OrganizationsOrganizations use systems to advance their organizational design (get organized better) and, consequently, to achieve economic gains.

Organizational Design: Composition of tasks and processes, departments, methods of management, stable beliefs & behaviors, power distribution…

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OrganizationOrganizational Design

Efficiency ofoperations

Effectiveness ofbusiness

OrganizationInformation Systems

Impacts

Economic aspects

IS and Organizations (cont.)

Operational Efficiency: Save time (on tasks…) & money (on materials, equipment, labour)

Business Effectiveness – accomplishing competitive targets:

New product (good or service)Product differentiated from competitors’Market-related goalsCustomer-related goals

Systems should advance methods of organizing and help to increase efficiency and effectiveness of organizations.

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Organization

Collection of individuals sharing work, following certain rules and using technology to produce certain good or service.

Organization takes inputs from the environment, transforms them, and puts the result out into the environment.

Organization can be viewed from the perspectives of

Structure

Processes

Culture

Politics

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Organizational StructureOrganization of work:

tasks, procedures, processes, jobsdepartments (functions; grouping of work); distribution of work in geographical space

Levels of management (Hierarchy)Rules and regulations (Formalization)Distribution of decision making power (Centralization)

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IS Impact on Organizational Structure

Systems can directly impact organizational structure via changes in the organization of work (e.g., task modification)

Reduction of middle management (“flattening” of hierarchy)

Reduction of explicit rules & regulations (less written rules)

Broader distribution of decision making power (decentralization)

Organizational (Business) ProcessesProcess view of organizations is newer than structural. Business process is a set of tasks from a start to an end point, that deliver a value for a customer. Process can cut across departments.

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Structure View Process View

Tasks, jobs, departments Tasks, sub-processes, processes (consisted of sub-processes)

What type of work is covered How work is actually done

How work is divided up How work links up

Static view; describes work organization and rules

Dynamic view; flow of work, decision points

Frog’s view, focus on pieces Bird’s view, focus on a whole

Skills in focus Both skills and IST in focus

No focus on performance (results) Performance focus (value for customer)

Status-quo (no change interest) Change interest

IS Impact on Business Processes (BP)

IS used to support BP - Business Process Management (BPM).• Electronic linking of tasks & remote locations• Automated management of linked tasks• Measurement of time and quality enhanced

IS used to change BP – Business Process Reengineering (BPR). IS aids in making:• New BP possible (e.g., CRM, beyond org. boundaries)• Simpler, faster, less labour-intensive BP

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Organizational Culture

Stable beliefs and behaviors shared among organization members.

Beliefs and behaviors related to data/information/knowledge & IST examples:

the role of IST in business (support vs. driver)when to change IST (conservative vs. progressive)proper communication (face-to-face vs. tech-mediated & which) who should operate IST (all vs. specialists)what is better – paper or electronic data formatknowledge culture (e.g.: 3M, Microsoft) how to plan & develop IS, how to manage data

IS and Organizational Culture

Organizational culture is an important condition for developing and using IS

New IS can collide with organizational culture =>

failure of IS, old culture resilient (some EMR* systems)

culture change required (ERP systems)

mutual adjustment of systems and culture (GSS)

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Mutual Influences IS—Organization

Important! IS do not influence organizational design one way, existing organization (structure, processes, culture, politics) impacts on new IS as well.

Mutual influencing, IS adjust to an organization, and the organization adjusts to IS.

The proportion of mutual adjustment is a matter of scale, depending on a particular organization.

System’s IT matters (flexibility)! Management of change matters (attention, persistence, initiatives)!

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OrganizationIS Impacts